On Monday, Piper Sandler maintained its Overweight rating and $66.00 stock price target for Biohaven Pharmaceutical Holding (NYSE:BHVN), despite a significant delay in the release of specific trial data.
The delay pertains to the disclosure of Single Ascending Dose (SAD) data for BHV-1300, a novel pan-IgG degrader. The company decided to postpone progressing to the next dose cohorts to fully understand the longer-term follow-up.
Biohaven management’s discussions reveal that the IgG lowering effects observed are in line with preclinical models. Although no data were presented today, the management’s commentary suggests that the IgG reduction is consistent with expectations. The full details are anticipated to be unveiled at the company’s R&D Day on May 29th, and the firm continues to recommend the stock to buyers.
Despite the shift in timeline, Piper Sandler expressed optimism, noting that preliminary IgG data appear to align with preclinical findings, which have demonstrated a reduction of over 80% in IgG levels following a single dose.
The firm believes that a decrease of 70% or more in IgG levels, coupled with a clean safety profile, would be considered a success. Furthermore, the company has reported no serious adverse events (SAEs) or adverse events (AEs) related to BHV-1300 thus far.
While the data release has been pushed back to later in the second quarter, expectations remain for the SAD data to indicate a substantial IgG reduction with a clean safety profile. This would significantly de-risk the asset.
Follow-up Multiple Ascending Dose (MAD) data in a yet-to-be-disclosed indication, potentially rheumatoid arthritis, is also expected to serve as a critical proof of concept, although the timing for this has not been confirmed.
Piper Sandler concludes that with one of the most catalyst-rich periods in the sector this year, Biohaven’s stock remains attractive, and investors are encouraged to continue buying.
InvestingPro Insights
As investors consider Piper Sandler’s optimistic outlook on Biohaven Pharmaceutical Holding (NYSE:BHVN), it’s important to note some financial metrics and analysis provided by InvestingPro. The company holds a market capitalization of $4.33 billion and has demonstrated a high return over the last year with a 292.74% increase in its year-to-date price total return.
Despite the absence of profitability in the last twelve months, with an adjusted P/E ratio of -9.92 and an operating income of -$436.05 million, Biohaven’s liquid assets do exceed its short-term obligations, indicating a level of financial stability.
InvestingPro Tips highlight that Biohaven holds more cash than debt, which could provide a cushion for the company as it navigates the development of BHV-1300. Still, analysts are cautious, noting weak gross profit margins and the expectation that the company will not be profitable this year.
The company does not pay dividends, which may be a consideration for income-focused investors. For those interested in a deeper dive into Biohaven’s financial health and future prospects, there are additional InvestingPro Tips available at https://www.investing.com/pro/BHVN.
For readers looking to leverage these insights, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription on InvestingPro. Currently, there are 11 more InvestingPro Tips available that could help inform your investment strategy regarding Biohaven.
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